by Julie Martin, MNE Tax
The OECD today released a peer review report judging whether 116 countries and their tax administrations have met standards on the collection and exchange of country-by-country (CbC) reports on large multinational businesses.
This is the second annual peer review released by the OECD on countries’ compliance with the CbC reporting guidelines. The CbC reporting standards were agreed to by OECD and G20 nations in 2015 as a result of the base erosion profit shifting (BEPS) plan. The standards were later adopted by the “Inclusive Framework on BEPS,” which is now comprised of 134 countries.
The report covers the period through April 2019.
“The peer-review outcomes and the launch of the global exchange of CbC reports in June 2018 show that the BEPS measures are being implemented rapidly, consistently and globally,” said Pascal Saint-Amans, Director of the OECD Centre for Tax Policy and Administration, announcing the report.
The report assesses each countries’ domestic legal and administrative framework for CbC reporting; the exchange of information framework adopted; and the degree to which they meet standards on confidentiality, consistency, and appropriate use of the reports.
Several countries failed to meet rules on appropriate use of CbC reports.
Rasmus Corlin Christensen, a Ph.D. Fellow at Copenhagen Business School, counted 45 such countries, noting on Twitter that Turkey, a large G20 country, is on that list. Other notable countries that did not meet appropriate use standards, Christensen said, include Chile, Egypt, Israel, Kenya, Pakistan, Paraguay, Saudi Arabia, Senegal, Thailand, Tunisia, Ukraine, Vietnam, and Zambia.
According to the OECD, more than 80 jurisdictions have introduced CbC reporting and most countries implement CbC reporting consistently with the BEPS Action 13 minimum standard.
More than 2200 bilateral relationships for CbC exchanges are now in place, the OECD said.
Information collected and exchanged in the CbC reports includes each large MNE’s revenue, profit before income tax, income tax paid and accrued, stated capital, accumulated earnings, number of employees, and tangible assets. The data is broken down by jurisdiction.
Julie Martin
Julie Martin is the founder of MNE Tax. She edits the publication and regularly contributes articles on new developments in cross-border business taxation.
Julie has worked as a tax journalist and editor for more than 13 years. Prior to that, she worked as an in-house tax attorney in New York. She also holds an LLM in taxation from New York University School of Law.
Julie can be reached at [email protected].
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